We are sure that you have dealt with the sale and purchase of properties that have experienced settlement delays caused by the banks. The financial institutions face an extremely high level of pressure, especially during times of low interest rates, high demand in properties, high level of auction sales and my favourite, the Christmas rush.
How can you help avoid settlement delays?
It is not easy, we understand. When a buyer or seller have stressed, they ‘want to settle before Christmas’, it is difficult to say no. Here are some things you can do to assist: -
Remind buyers and sellers that banks are struggling to keep up with the demand in settlement especially during Christmas;
Be very particular when setting a date for settlement (ie. instead of settlement date falling on the 4th of January, arrange for settlement date to fall on a later date in January);
Remind buyers and sellers that the banks may be shut or skeleton staff may be working during the Christmas break therefore work from their end could be delayed;
Critical dates under the contract fall on business days, remind buyers and sellers that a business day does not include the period 27 to 31 December and public holidays;
Remind buyers and sellers to do everything in their power to assist their banks to have finances ready for settlement (should they insist on settling before Christmas); and
Remind buyers and sellers that should the banks not be able to settle on time, it will place the parties in breach of the contract and potentially put them in a more difficult position later.
Don’t be afraid to ‘frustrate’ the clients at the start and advise them of the reality of the Christmas period before they start packing their bags and getting their hopes up. You’re doing it to benefit them and they will thank you in the end.